Dust Off Dominoes for South Korea

It’s hard to believe that America is even questioning the need to help South Korea out of its tight spot. Yet there are members of Congress who actually oppose more help for our longtime ally, either because (on the left) they think the U.S.-backed International Monetary Fund’s cure is worse than the disease, or (on the right) they think the disease will cure itself if only the market system is left alone. True, domino theories have been shelved since Vietnam went communist and the rest of the world aimed toward open markets. But reasonable people might conclude that a country that daily looks down the gun barrels of North Korea and which is still so vital to U.S. strategic and economic interests deserves more than a brushoff.

The Asian financial crisis may be endangering stability on the Korean peninsula: The financing of the expensive, complex but wise arrangement by which North Korea gets two peaceful nuclear power plants in return for eschewing nuclear weapons is slowing down. Washington fears that if the reactor deal doesn’t go forward, North Korea could have incentives to re-start a weapons program. Also, if North Korea, with one of the world’s largest standing armies and little to lose if nothing goes its way, invades South Korea, the result will make the 1991 Iraqi invasion of Kuwait look like Ronald Reagan’s happy days in Grenada. And while South Korea is many thousands of miles away from the U.S., in important respects it might as well be just around the corner. Leaving aside the North Korean nightmare, if South Korea’s economy falls completely over, politically deadlocked Japan might start rocking, too--and that’s a scenario no one should want to land in the world’s lap.

A leading economic advisor to South Korean President-elect Kim Dae Jung was in the U.S. last week, being watched by American officials and businessmen as closely as if he had been the head of the North Korean military. For if the South Korean economy can be righted, then some kind of economic integration with the North, however slow and tentative, can begin, as Kim Dae Jung suggests. So when You Jong Keun, an elected provincial governor who’s working with the president-elect, met with administration officials, it became hard for the Americans to hold back their smiles. “His orientation is strongly toward markets, transparency and accountability,” reports tough-minded U.S. Trade Ambassador Charlene Barshefsky. “He emphasized how serious Korea is. I must say, this is positive.”

Another administration trade official, Peter Scher, was in California Friday to persuade the state’s huge agribusiness lobby that if Korea and Asia falter further, so will their markets, and showed similar enthusiasm: “There is a real commitment in Korea. If this democracy can pull it off and reform itself, this will send a powerful message to other Asian countries, especially China.”

What is everyone so excited about? If You is truly speaking for Korea’s new president, then our ally is on the verge of undertaking massive new reforms that could, with the continuing support of the West, create a second South Korean economic miracle and make this rapidly developing democracy into Asia’s comeback kid. For despite its sagging currency, staggering foreign debt and a badly battered banking system, Korea dreams of emerging from its current collapse stronger than ever, to show others in Asia just how a true democracy goes about economic reform.

In a blunt briefing in Los Angeles last week arranged by the Asia Society California Center, You openly admitted that Korea, its government, its banks and its entrepreneurs made far too many mistakes and now realize they have hardly anyone to blame but themselves. But aren’t Koreans bitter about the West’s reform conditions? Despite all the reports to that effect, You claimed, Koreans by and large “are very grateful for America’s timely economic assistance which was, once again, indispensable to Korea’s recovery from another crisis.” If Korea has an attitude problem about America, it wasn’t apparent in this guy. For our good and the world’s, the U.S. cannot root hard enough for South Korea to recover.

These past few weeks, President Clinton and his administration have been weighing the pros and cons of military action against Iraq. But if North Korea’s army goes south in what would undoubtedly prove to be a suicide lunge, the president might be compelled to reinforce, massively, the tripwire contingent of 37,000 American troops there now. For as bad as South Korea’s economy may be, it’s a winner compared to the Stalinist North.

The North, a woebegotten failure of a nation, has been salivating over the multibillion-dollar gift of those two new nuclear power plants. But with the program’s two main financiers--South Korea and Japan--having their own serious economic problems right now, the deal with North Korea, though certainly not dead, seems shaky. It would be a tragic error if Western policies inadvertently threw Asia’s comeback kid back into the ring with the world’s most conspicuous but heavily armed failure desperate enough to go the distance.